- The American Health Care Association (AHCA) is suing the federal government over a recently announced rule that prohibits long-term care facilities from employing binding arbitration agreements in patient contracts, NPR reported.
- AHCA argues the rule violates the Federal Arbitration Act and that arbitration is often less costly for both sides than filing a lawsuit in court.
- The arbitration ban is part of a set of regulatory reforms that target long-term care facilities and are set to go into effect on November 28, although the AHCA lawsuit is attempting to delay the ban on arbitration.
Long-term care facilities have been drawing a lot of criticism over the practice of forced arbitration. Critics accuse long-term care facilities of taking advantage of patients, often nearing the end of their lives and in desperate need of care, by offering a choice between care and their legal rights.
There are numerous accounts of patients and their families who have been dealt a disservice through forced arbitration. In one instance, reported by The New York Times, a case involving an elderly woman who was strangled in a nursing home was initially barred from court due to a forced arbitration clause. The report preceded a The New York Times editorial, published in July, accusing long-term care facilities of denying justice and legal recourse to patients who have been wronged.
The source of criticism isn’t limited to media outlets. Politicians, lawyers, and patient advocates have all expressed outrage over forced arbitration clauses. Senators and attorneys general from 15 states called for an end to forced arbitration agreements before the rule was issued, according to NPR. Julie Braman Kane, president of the American Association for Justice, issued a statement accusing long-term care facilities of hiding behind forced arbitration to cover up abuse and neglect. “Ironically, the nursing home industry is using a lawsuit to try to deprive residents and their families of that same right,” she quipped.
It seems that most outside of the long-term care industry support the ban on forced arbitration clauses. However, it could also be that more providers are trying to use forced arbitration to limit liability and legal costs. In August, Sutter Health issued an ultimatum to employers: Agree to arbitration or lose access to in-network prices.